Question

A credit card company charges 12% interest on any unpaid bill amount at the end of each month. The table shows how much interest they will charge for the following unpaid bill amounts.

Unpaid Bill Amount $1 $25 $100 $200 $425
Interest $0.12 $3 $12 $24 ?

How much interest would be charged on the unpaid bill amount of $425?
A.
$36
B.
$51
C.
$12
D.
$45

Answer 1

To calculate the interest charged on an unpaid bill amount of $425 at a rate of 12%, you can use the formula:

\[
\text{Interest} = \text{Unpaid Bill Amount} \times \text{Interest Rate}
\]

Substituting the values:

\[
\text{Interest} = 425 \times 0.12
\]

Calculating this:

\[
\text{Interest} = 425 \times 0.12 = 51
\]

So, the interest charged on the unpaid bill amount of $425 would be **$51**.

The correct answer is **B. $51**.